USD/JPY: Yen retains gains in Asia, near 122.70

FXStreet (Mumbai) - The Japanese yen keeps its upbeat momentum intact and trades nearly weekly highs against its US counterpart in late-Asia/early Europe, with USD/JPY miring near lows below 5-DMA.

USD/JPY heading towards 20-DMA at 122.64?

Currently, the USD/JPY pair trades -0.11% lower at 122.72, hovering close to session lows struck at 122.67 earlier on the day. The JPY remains bid this session on the back of poor sentiment on the Asian equities and upbeat Japan’s manufacturing data, thereby dragging USD/JPY lower.

The Nikkei-Markit Flash Japan Manufacturing PMI rose from 52.4 in October to a 52.8 in Nov, reaching the highest level since March 2014.

More so, the US dollar continues to correct lower against its six major peers, after reaching three figures on Monday, as the sentiment was badly hit after the US manufacturing gauge negatively surprised markets.

The latest US preliminary manufacturing PMI reading from Markit came in at 52.6 in Nov, compared to the 54.1 seen in October. Markets had predicted the gauge to hit 54.0.

Looking ahead, the major will be influenced by the sentiment on the European markets while the upcoming US GDP report will also have significant impact on the pair.

USD/JPY Technical levels to watch

The prices trade below 5-DMA and finds immediate support at 122.64 (20-DMA) below which 122.44 (daily S2) would be tested. To the topside, the immediate resistance is located at 122.96 (10-DMA). A break above the last, the major could test 123.28 (Nov 23 High).
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